Saab, BMW may share parts for a new small car, sources say

MUNICH -- BMW AG and Saab are considering sharing parts and technology for a new small car the Swedish automaker wants to build, two people familiar with the matter told Bloomberg News.

A possible deal for BMW to provide Saab with engines, transmissions and allow Saab to use BMW's platform is in the early stages and an announcement isn't imminent, the people said, declining to be identified because the negotiations are private. An agreement will take at least two months, one of them said.

The parts and platform would be used to build a tear-drop shaped car, inspired by the Saab 92 model that was in production between 1949 and 1956.The partnership talks were first reported today in Swedish newspaper Dagens Industri.

Saab, which Dutch supercar maker Spyker Cars NV bought from General Motors Co. in February, has spent the last three months restarting production and severing most of its GM ties.

Various parties

Spyker CEO Victor Muller told Bloomberg today that Saab is “talking to various parties” about sharing technology as a way to lower costs. Muller declined to say whether he is in discussions with BMW.

Saab, in an official statement, said: "We indeed are looking for alliance partners but no cooperation with has been confirmed at this time. A smaller Saab below the 9-3 is not currently in our business plan though it would be on our wish list."

BMW would not comment specifically on the Dagens Industri story. "We are in talks with several interested parties who have interest in our technology," a BMW spokesman said. "There are no contracts with Saab at the moment."

BMW diesel engine

Dagens Industri said there are also plans for BMW to supply a diesel engine for Saab's 9-4X midsize crossover, which will be built at a GM plant in Mexico starting in April 2011 and launch in Europe at the start of 2011.

Spyker is hoping to restore the fortunes of the Swedish brand, aiming to more than double yearly sales to 85,000 by 2012.